Tesla has now confirmed that the reason why we haven’t seen a groundbreaking at Gigafactory Mexico yet is because the automaker is pumping the brakes a bit on the project.
After months of rumors, Tesla finally announced Gigafactory Mexico during its Investor Day in March. The automaker secured a piece of land just outside of Monterrey, Nuevo León, to build the plant.
Tesla has talked about building the factory in record time with the hope to beat Gigafactory Shanghai’s timeline of nine months between breaking ground and production.
However, that groundbreaking has yet to come.
We recently reported that we should expect the factory to come online later than expected, based on information from suppliers.
After the release of its Q3 financial results, Tesla’s management was asked about the schedule for Gigafactory Mexico. The speaker didn’t present himself, but I assume it was Tom Zhu who said:
For Mexico, we are working on infrastructure and factory design in parallel with the engineering development of the new production that we’ll be manufacturing there. That’s all I can share for that.
But then CEO Elon Musk jumped in and revealed that Tesla is pumping the brakes amid worries about the global economy:
And in Mexico, we’re laying the groundwork to begin construction and doing all the long lead items, but I think we want to just get a sense for the global economy is like before we go full tilt on the Mexico factory. I am worried about the high interest rate environment that we’re in.
The CEO spent most of the call complaining about the impact of high interest rates on Tesla’s business. Later on the call, Musk reiterated that Tesla is definitely moving forward with Gigafactory Mexico, but he can’t give a timeline amid those concerns. Another Tesla executive also jumped in nothing that Tesla still has room to grow at Gigafactory Texas if Giga Mexico falls too much behind.
Recently, we learned that Tesla plans to build its next-generation vehicles at Gigafactory Texas before Gigafactory Mexico, which was first announced as the location for the next-gen vehicles.